INTERNATIONAL – Consumer goods giants such as Nestlé and Procter & Gamble have initiated investigations following claims by an environmental group, Rainforest Action Network (RAN), that palm oil sourced from an illegally cleared wildlife reserve in Indonesia may have entered their supply chains. RAN, a US-based organization, reported that rainforests within Indonesia’s Rawa Singkil Wildlife Reserve, a legally protected area, had been cleared to make way for palm oil plantations over the past eight years.
RAN’s investigation, supported by satellite imagery, indicates significant deforestation in the area. These images show large sections of cleared land, where lush rainforests once stood, now replaced by rows of young palm trees. The environmental group claimed that some images from a field investigation conducted in February 2024 showed oil palm seedlings planted on burnt soil surrounded by fallen trees, located within the wildlife reserve.
The Rawa Singkil Wildlife Reserve, situated in Aceh province on Indonesia’s Sumatra Island, has seen the loss of 2,609 hectares of forest since 2016, with palm oil plantations now covering 645 hectares of the previously cleared land, according to RAN’s findings. Although Reuters could not independently verify these findings, RAN’s report has raised alarms about illegal activities affecting the biodiversity of this crucial conservation area.
RAN’s investigation revealed that fresh fruit bunches from the illegal plantations were allegedly sold to palm oil mills PT Global Sawit Semesta (GSS) and PT Aceh Trumon Anugerah Kita (ATAK), both of which supply major global brands, including Nestlé, Procter & Gamble, Mondelez, and PepsiCo. These two mills are located in remote regions, making them inaccessible for comment.
Nestlé responded swiftly, engaging with its direct suppliers to investigate the claims. The company emphasized that by the end of 2023, 96 percent of its palm oil supply was sourced from “deforestation-free” areas. Procter & Gamble also took immediate action, suspending its palm oil sourcing from GSS and ATAK following RAN’s revelations.
Other companies involved, including Royal Golden Eagle Group (RGE), Musim Mas, and Permata Hijau, were also found to have sourced palm oil from GSS. RGE and Musim Mas confirmed they were investigating the matter, while Permata Hijau, Mondelez, and PepsiCo did not respond to requests for comment.
Indonesia, home to the world’s third-largest tropical rainforest, reported a reduction in its deforestation rate between 2020 and 2023, down from over 400,000 hectares annually in previous years. However, RAN’s investigation suggests that deforestation within the Rawa Singkil Wildlife Reserve has surged significantly between 2021 and 2023, despite existing laws prohibiting such activities.
RAN has accused palm oil mills, traders, and global brands sourcing from the area of failing to eliminate deforestation in what it calls the “Orangutan Capital of the World,” where endangered species like orangutans, tigers, elephants, and rhinos coexist. The report underscores the environmental damage caused by expanding palm oil plantations into protected forests, exacerbating concerns about the sustainability of the palm oil industry.
Palm oil, produced primarily in Indonesia and Malaysia, accounts for 60 percent of global vegetable oil exports. It is widely used in food, cosmetics, biofuels, and other products, fueling the demand that drives deforestation. Despite efforts to curb illegal deforestation, environmental groups continue to expose the impact of palm oil production on critical habitats, urging brands and consumers to seek sustainable sourcing practices.
